Singapore Payment Service Provider Licence - Digital Payment Tokens

An applicant is expected to set out clearly in its application, the assessment of the DPT. Within its business plan, it should explain clearly the factors that it has relied on to determine whether a customer that buys a DPT from it does so with the intention of using it for payments for goods and services. The applicant should also address the risks under which a customer will use the DPTs for investment purposes and how that risk is mitigated.

For instance, an applicant proposing to list a DPT for the redemption of cleaning services has limited the maximum DPT value to SGD 100 equivalent on the relevant DPT. Whereas a DPT for the purchase of computers could have a DPT value limit of SGD 5,000 on its relevant DPTs.

A great degree of critical thinking and analytical skills will be required to the limiting of risks for DPTs bought for investment purposes, failing which a DPT may risk judicial reclassifications risk and amount to a security under the Securities and Futures Act.

You may wish to consult one of our experts when crafting risk mitigation mechanics for digital payment tokens offered.